Lately my old system with a 4870 512mb has been getting BSOD's with Memory_management error in games like Assassins creed 3, BF3, FarCry 3so i wnet ahead and increased fan speed to 70%(waaaay to loud so i just turn up the vol. to hide it ) it seemed to take away the problem but only for a while then i decided to go back to stock still the problem persisted so i took it down to 850mhz default was 900mhz and the problem is well gone pretty much so i was wondering if the memory chips have degraded over time?

Have you used one of the many utilities available to keep an eye on GPU temperature? That would be a good place to start. The BSODs are a bad sign but if it's a heat issue then you might be able to fix it by either adding in a new case fan or maybe you could replace your existing GPU fan if the old one is failing.

If downclocking the GPU has solved most of the issues, this sounds to me as it has some kind of overheating problem.You should try to clean the heatsink and fan, and if that is not enough you can consider getting a new cooler for your graphics card.I don't think your gfx memory is degrading over time.